The hidden danger ahead. GP practices may not have the financial strength and planning foresight to trade through when wages rise.

Reflections on what could turn around recruitment into GP led me to think on what GPs are looking at in the near future. of course the time horizon is 20 years for training British/UK GPs… GPs are self employed and therefore take profits. (Video: How to publish GP earnings  ) Whether it is better to be self-employed in a deliberately neglected service is a matter for debate. The RCGP article by Peter Davies in 2008 is worth a read: a lot has changed! A 16% pay cut over 6 years… (Source: Pulse March 2016)

HMRC GP Pay 2016 Pulse

The minefield ahead includes “overhead”, and any junior planning to be a GP should be thinking of this when they consider becoming a partner. GP practices may not have the financial strength and planning foresight to trade through when wages rise. Most Health Service expenses, Hospitals and GPs, are staffing costs. Many staff are on near minimum wage and do their job through love. When the minimum wage rises to £9 in a couple of years’ time, GPs will have a dilemma. Do they cut staffing levels (again)? Do they increase everyone to the same minimum wage, and lose any differentials between staff? Do they try to maintain the differentials, which then have “add on expenses” in NI and pension costs? Since there will be no extra money GP practices will be squeezed. Their options are stark… they can sell up & go elsewhere, they can dig in and suffer financially, or they can downsize staff. They could offer a two tier service in the richer suburbs,, like dentistry, but if their income privately becomes more than 10% they have to adjust their building rental. We are all at risk now, and unless there is a mixture of overt rationing measures, which are evident to everyone, and fair, we are going to get a two tier system, just like the dentists. The minefield may be more risky for larger less nimble practices..

How many practices have done a “what if” spreadsheet for their business? How many ask the new partners to buy in at the last DV valuation? (This happens every 3 years, and there is a risk property can fall, and notional rental values covering loans can fall with it). All this needs to be factored in when joining a partnership. Then: Who will be the “last man standing” in your practice? Changing the rules of the game 

In the end it will be “do I like these people and this culture?” and “do I trust them?” Next, it should be “do I trust government to ensure that general practice is properly funded and founded within the near future?”. It is at this hurdle that applicants may turn away.. The culture of failure encapsulated by Mr Hunt is not going to help recruitment.

BBC News on 27th July 2015 reported: Living Wage ‘could harm home care sector’ – BBC News and his was reinforced today in the Lancashire Visitor: Care Services Putting Older people at risk… damning report reveals

The Chancellor’s recent budget affected pensions: BBC News 18th March 2017:m Public sector pensions change in Budget criticised

In last year’s budget Larry Elliott and Patrick Wintour for the Guardian opined: Budget 2015: Osborne hopes minimum wage increase will soften welfare cuts

Treasury expects £10bn surplus in final year of parliament thanks to cuts and economic growth – but critics say chancellor is placing the burden on the poor

and the effect on small businesses was raised 10th March 2016 in the Guardian: ‘National living wage‘: what employers need to know

Care services in Lancashire are putting older people at risk and leaving thousands of workers with “unacceptably low pay and conditions” according to a damning report.

The GP recruitment farce – Mr Hunt never said the 5000 would come from the UK!

NHS chief brands GP recruitment strategy ‘crazy’. Now that government has abandoned it, is General Practice is a key election issue

Doctor’s warning over “perfect storm” GP recruitment crisis

Fresh concerns raised about GP recruitment after figures showed more than 40% rise in number of GPs over age of 55 in past decade

GP Recruitment and Spending in Wales: The GP spending share of the health budget has plunged from the highs of 2005-2006

GP recruitment – and leadership opportunities?

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This entry was posted in A Personal View on by .

About Roger Burns - retired GP

I am a retired GP and medical educator. I have supported patient participation throughout my career, and my practice, St Thomas; Surgery, has had a longstanding and active Patient Participation Group (PPG). I support the idea of Community Health Councils, although I feel they should be funded at arms length from government. I have taught GP trainees for 30 years, and been a Programme Director for GP training in Pembrokeshire 20 years. I served on the Pembrokeshire LHG and LHB for a total of 10 years. I completed an MBA in 1996, and I along with most others, never had an exit interview from any job in the NHS! I completed an MBA in 1996, and was a runner up for the Adam Smith prize for economy and efficiency in government in that year. This was owing to a suggestion (St Thomas' Mutual) that practices had incentives for saving by being allowed to buy rationed out services in the following year.

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